The deVere Group is the world’s leading independent international financial consultancy. Expats come to us wishing to unlock their UK pensions in order to live their dream retirement overseas, and we are there to advise them and potentially help them transfer their pension into a QROPS.
In our QROPS guide, we provide you with all of the information on the pension scheme in order for you to make an informed decision on transferring your UK pension into a QROPS. We will explain to you what transferring your UK pension into a Qualifying Recognised Overseas Pension Scheme, or QROPS, entails. What benefits there are for you as an expat in transferring your existing UK pension into a QROPS? In addition, we will let you know whether you qualify in order to transfer your UK pension into a QROPS.
A QROPS transfer can potentially be beneficial to you as an expat if you are retiring abroad as you may have much more access and growth to your UK pension than you expected. Pensions held in the UK can potentially create quite a large tax bill after taking your lump sum, as they will be subject to UK income tax once you start receiving your income (less any double taxation treaty relief). As a pension scheme, QROPS allows you certain benefits in the country that you have decided to retire in that may well be more efficient and flexible than a UK pension.
It is important to remember that you can only transfer your pension into a QROPS that is recognised by the UK HMRC. The UK HMRC keeps an up-to-date list of recognised QROPS schemes on their website for expats to refer to. If the scheme that you wish to transfer into is not listed, then you should be wary. Most QROPS schemes that are recognised by HMRC are based in well-regulated and neutral offshore jurisdictions like Malta or Gibraltar.
If you would like country-specific information on QROPS and how they work in your new country of residence, then please contact our local office in your country of residence as we have offices in most jurisdictions.
UK pensions have traditionally been frozen or have not kept up with inflation when the holder leaves a company scheme to reside overseas and did not have access to their pension until the normal scheme retirement date. This changed in April 2006, when HMRC changed regulations surrounding pensions enabling holders to transfer their frozen UK pensions to another country when they move overseas.
By transferring your frozen UK pension into a QROPS scheme, you can have access to a lump sum immediately on retirement and can receive variable regular payments depending on your circumstances and in a currency of your choice.
You will also have greater chances of growth and a wide choice of assets to select from that matches your risk criteria. You should also consider the solvency of your UK scheme if it is a defined benefits scheme and the likelihood of receiving your full pension. There are also benefits available for your beneficiaries upon your death.
If you are unclear on whether an overseas pension scheme is beneficial to you, please contact us. Alternatively, you may download our free Guide to QROPS - which details the benefits and qualifications.